I'd be lost on the floor of a pit but can tell you that a number of his points run contrary to what I've been doing electronically for the past 20 years.
25 points mantra discipline for day trading By Douglas E. Zalesky
- Thread starter Chuck Krug
- Start date
Some good rules.
However, #13- Ignore news. News is history.
Probably one of the dumbest things I’ve ever read.
We had a small group (before news reading bots) that in the late 90’s and 2000’s collectively made tens of millions trading breaking news from Bloomberg, Reuters, DJ, CNBC, etc.
Even now that bots have taken over the news game, how many times have the futures been getting pounded all day only to get a 3pm comment from someone and the market rips 20-30 handles into the close.
Never ignore news. It makes no sense.
However, #13- Ignore news. News is history.
Probably one of the dumbest things I’ve ever read.
We had a small group (before news reading bots) that in the late 90’s and 2000’s collectively made tens of millions trading breaking news from Bloomberg, Reuters, DJ, CNBC, etc.
Even now that bots have taken over the news game, how many times have the futures been getting pounded all day only to get a 3pm comment from someone and the market rips 20-30 handles into the close.
Never ignore news. It makes no sense.
You're day trading. The chart will tell you how traders perceive the news before you get it.
Couldn’t disagree more.
But there’s more than one way to make a buck in this business, so whatever works for you.
Bots are not traders.
As for traders we have no way of knowing the news beforehand or how the market might perceive it - more times than not.
Believing otherwise is one of the dumbest things I've ever read.
I agree with most of the list (good agreement with 20 out of 25), so i would say it is a pretty good list!
Discipline is super important!
A trader with a weak (slightly positive) edge with strong discipline will make more money than a trader with a strong edge but weak discipline.
Had a few minor issues with some of the points:
4) NEVER TURN A WINNER INTO A LOSER.
Only if that is part of your trading rules. Personally i don't care if a winner turns into a loser. If my system is profitable it will make money over the long run. The effect of the odd winner turning into a loser won't affect long term profitability. Although if the trader is mentally weak it may affect his short term psyche.
15) LOVE TO LOSE MONEY.
This is correct, but incomplete. Jerry Parker says it better when he says you should love every part of your trading system including the losing trades it takes. It is easier to love your overall system as it is designed it to make money over the long run.
16) IF YOUR TRADE IS NOT GOING ANYWHERE IN A GIVEN TIMEFRAME, IT’S TIME TO EXIT.
Again only if that is part of your trading system. I personally don't do this.
18) MAKE A LITTLE BIT EVERYDAY. DIG YOUR DITCHES. DON’T FILL THEM IN.
Again only if that is part of your trading rules. I dont care if i have a losing day or even a losing month. As long as i make big money in the long run. Trying to make money every day might reduce overall profitability in a big way.
19) HIT SINGLES NOT HOME RUNS.
Only if that is part of your trading rules. Personally i like to aim for a 3:1 reward:risk at a minimum. I won't take a trade with less potential profit. But that is me, other trades may be happy with a lower target. They say the old pit trades could make a living just from the bid/ask spread. That sounds like the ultimate single hitting.
Discipline is super important!
A trader with a weak (slightly positive) edge with strong discipline will make more money than a trader with a strong edge but weak discipline.
Had a few minor issues with some of the points:
4) NEVER TURN A WINNER INTO A LOSER.
Only if that is part of your trading rules. Personally i don't care if a winner turns into a loser. If my system is profitable it will make money over the long run. The effect of the odd winner turning into a loser won't affect long term profitability. Although if the trader is mentally weak it may affect his short term psyche.
15) LOVE TO LOSE MONEY.
This is correct, but incomplete. Jerry Parker says it better when he says you should love every part of your trading system including the losing trades it takes. It is easier to love your overall system as it is designed it to make money over the long run.
16) IF YOUR TRADE IS NOT GOING ANYWHERE IN A GIVEN TIMEFRAME, IT’S TIME TO EXIT.
Again only if that is part of your trading system. I personally don't do this.
18) MAKE A LITTLE BIT EVERYDAY. DIG YOUR DITCHES. DON’T FILL THEM IN.
Again only if that is part of your trading rules. I dont care if i have a losing day or even a losing month. As long as i make big money in the long run. Trying to make money every day might reduce overall profitability in a big way.
19) HIT SINGLES NOT HOME RUNS.
Only if that is part of your trading rules. Personally i like to aim for a 3:1 reward:risk at a minimum. I won't take a trade with less potential profit. But that is me, other trades may be happy with a lower target. They say the old pit trades could make a living just from the bid/ask spread. That sounds like the ultimate single hitting.
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Bots are not traders?
I don’t understand your post
I was a bit put off by the common platitudes that we've heard recited countless times ad nauseum - so I googled the book and author. This is like 15 years old - which is about the waning hours of opportunity for a trader with a mouse and a DOM execution window being able successfully day trade in the literal sense of the term with many trades taken during the course of a typical trading day.
It's gotten a helleva lot harder since 2003 Mr. Zalesky. The structure of the markets and the highly capitalized ECN speed bias has changed monumentally since. Shit, we've gone from collocated servers to collocated sockets.
Obviously you're not going to be able to sit there hand on mouse concentrating on a DOM order book and beat out the bots and the automation these days. You're going to have to be much more selective and I would imagine that your trade holding time frames might have lengthened as well to make it day trading. Good luck with that.
It's gotten a helleva lot harder since 2003 Mr. Zalesky. The structure of the markets and the highly capitalized ECN speed bias has changed monumentally since. Shit, we've gone from collocated servers to collocated sockets.
Obviously you're not going to be able to sit there hand on mouse concentrating on a DOM order book and beat out the bots and the automation these days. You're going to have to be much more selective and I would imagine that your trade holding time frames might have lengthened as well to make it day trading. Good luck with that.
qxr1011,for the market its irrelevant who you are and what you are
what is disciplined?
disciplined are the acts based on predefined by yourself rules.. that's all
if rules are shitty then it does not matter how disciplined you are in following them - you will lose
baloney
size to be maintained
you not trading poorly (if your method works) or well, it just the random distribution of the wins and loses
its not up to the trader , its up to the method
remember your earlier statement about being disciplined ? well then have the fucken discipline to stick to the method regardless or what's coming at you - the win or the loss
yes it can, so what?
so far that's the only correct statement
also its does not address the situation in which most wannabes are - what to do when you developing the method and not yet know if its working or not, how long to stick to it?
agree
on top of that regardless of how much one tries one always will be only himselfso do not imitate - it does not work
so?
how to make sure you will be able come back? - have a small enough position (considering the method works)... size kills... absolute size of the daily loss is irrelevant , size of the
loss to be determined by the method only
it comes naturally
do not get out out of position just because it turned against you - if and when to get out to be
to be determined by the method only (again remember all the earlier talk about discipline - well that's the time to show some balls)
baloney
as i said earlier - it just random distribution
hope and pray does not hurt... but won't help either
each trader hopes and prays that his method works...
depends on what news we talking about
if you just heard that a plain flew in freedom tower - sell, or close the position -its history in a making.. and you do not want to be involved
baloney
trading is speculation in its pure form
baloney
one has to accept loses as part of the job
but to say to love it is akin to say to the boxer to love the hook in the chin...
love it....
whoever wrote this list is probably some "master" trader from the prop
to be determined by the method only
to be determined by the method only
to be determined by the method only
and what builds consistency?
baloney
stick with method
stick with the method, you have nothing else
baloney
one has to determine how to apply method properly its required sometimes a lot of thinking and analyzing the situation
hesitation is ok
if you could not figure out how to apply the method in particular case - then do not take the trade
market has no eyes, trader has
and trader views the market only through the prism of the method
not all trades are created equal even trough the prism of the method, but all of them are within the certain range of probabilities that the trader accepted when he created the method
market is just force of nature .. there is no justice or unjuistice in it
either trader figured out how to deal with these forces of nature (and he lives and prospers) or not (then he suffers and dies)
Thanks for commenting on this. In other words, just following a winning method and make money